Leveraged supply contracts

Abstract

An improved form of commodities contract that provides for a better economic basis than conventional contracts due to a leveraged design focus. Instead of focusing primarily on price, contracts according to the present invention emphasize the supply and usage of the underlying referenced commodity or product, creating a mechanism by which entities having an active interest in the underlying referenced commodity can take advantage of structured leverage, while also being beneficial to both the buyer and seller.

What is claimed is:  
     
         1 . A financial product comprising: 
 a contract having supply as a variable with greater influence than price.    
     
     
         2 . The financial product of  claim 1  wherein the contract is on a commodity.  
     
     
         3 . The financial product of  claim 2  wherein the commodity is an agricultural commodity.  
     
     
         4 . The financial product of  claim 3  wherein the agricultural commodity is corn.  
     
     
         5 . The financial product of  claim 3  wherein the agricultural commodity is soybeans.  
     
     
         6 . The financial product of  claim 2  wherein the commodity is metal.  
     
     
         7 . The financial product of  claim 6  wherein the metal is gold.  
     
     
         8 . The financial product of  claim 2  wherein the commodity is a fuel.  
     
     
         9 . The financial product of  claim 8  wherein the fuel is a petroleum prodcut.  
     
     
         10 . The financial product of  claim 2  wherein the commodity is a currency.  
     
     
         11 . The financial product of  claim 10  wherein the currency is a Euro.  
     
     
         12 . The financial product of  claim 2  wherein the commodity is a financial instrument.  
     
     
         13 . The financial product of  claim 2  wherein the commodity is a financial index.  
     
     
         14 . The financial product of  claim 1  wherein the contract is a commitment to cover the yield against underproduction of that yield.  
     
     
         15 . The financial product of  claim 14  wherein the contract is a commitment to cover the acres yield of an agricultural commodity.  
     
     
         16 . The financial product of  claim 14  wherein the commitment to cover the yield comprises a differential matrix of ranges of acres yield of an agricultural commodity.  
     
     
         17 . The financial product of  claim 16  wherein the differential matrix sets forth increments of yield shortfalls and the price per acre that the financial protection on crop yield shortfalls costs.  
     
     
         18 . The financial product of  claim 14  wherein the commitment to cover the yield is swapped between producers.  
     
     
         19 . The financial product of  claim 14  wherein the commitment to cover the yield is traded on a commodities exchange.  
     
     
         20 . The financial product of  claim 1  wherein the contract is a yield exchange.  
     
     
         21 . The financial product of  claim 20  wherein the yield exchange is swapped between producers.  
     
     
         22 . The financial product of  claim 20  wherein the yield exchange is traded on a commodities exchange.  
     
     
         23 . A financial product comprising: 
 a commitment to cover the yield against underproduction by providing replacement.    
     
     
         24 . The financial product of  claim 23  wherein the yield is of an agricultural commodity.  
     
     
         25 . The financial product of  claim 24  wherein the agricultural commodity is corn.  
     
     
         26 . The financial product of  claim 24  wherein the agricultural commodity is soybeans.  
     
     
         27 . The financial product of  claim 24  wherein the commodity is metal.  
     
     
         28 . The financial product of  claim 27  wherein the metal is gold.  
     
     
         29 . The financial product of  claim 23  wherein the yield is of a petroleum product.  
     
     
         30 . The financial product of  claim 23  wherein the yield is of a currency.  
     
     
         31 . The financial product of  claim 30  wherein the currency is a Euro.  
     
     
         32 . The financial product of  claim 30  wherein the currency is the British pound.  
     
     
         33 . The financial product of  claim 23  wherein the yield is of a financial instrument.  
     
     
         34 . The financial product of  claim 23  wherein the yield is of a financial index.  
     
     
         35 . The financial product of  claim 23  wherein the yield is of a stock dividend.  
     
     
         36 . The financial product of  claim 23  wherein the commitment to cover the yield is on the acre yield of an agricultural commodity.  
     
     
         37 . The financial product of  claim 23  wherein the commitment to cover the yield comprises a differential matrix of ranges of yield per acre.  
     
     
         38 . The financial product of  claim 37  wherein the differential matrix sets forth increments of yield shortfalls and the price per acre that the financial protection on crop yield shortfalls costs.  
     
     
         39 . The financial product of  claim 23  wherein the commitment to cover the yield of a commodity is swapped between producers.  
     
     
         40 . The financial product of  claim 23  wherein the commitment to cover the yield of a commodity is traded on a commodities exchange.  
     
     
         41 . A financial product comprising: 
 an exchange under which a future yield can be swapped with present yield.    
     
     
         42 . The financial product of  claim 41  wherein the yield is of a commodity.  
     
     
         43 . The financial product of  claim 42  wherein the commodity is an agricultural commodity.  
     
     
         44 . The financial product of  claim 43  wherein the agricultural commodity is corn.  
     
     
         45 . The financial product of  claim 43  wherein the agricultural commodity is soybeans.  
     
     
         46 . The financial product of  claim 41  wherein the yield is of a metal.  
     
     
         47 . The financial product of  claim 46  wherein the metal is gold.  
     
     
         48 . The financial product of  claim 41  wherein the yield is of a petroleum product.  
     
     
         49 . The financial product of  claim 41  wherein the yield of a currency.  
     
     
         50 . The financial product of  claim 49  wherein the currency is a Euro.  
     
     
         51 . The financial product of  claim 49  wherein the currency is the British pound.  
     
     
         52 . The financial product of  claim 41  wherein the yield is of a financial instrument.  
     
     
         53 . The financial product of  claim 41  wherein the yield is of a financial index.  
     
     
         54 . The financial product of  claim 41  wherein the yield is of a stock dividend.  
     
     
         55 . The financial product of  claim 41  further including a commitment to cover the acre yield of the future yield swap.  
     
     
         56 . The financial product of  claim 41  wherein the yield exchange is swapped between producers.  
     
     
         57 . The financial product of  claim 41  wherein the yield exchange is traded on a commodities exchange.  
     
     
         58 . A financial product comprising: 
 an exchange under which future yield can be swapped for present purchasing power.    
     
     
         59 . The financial product of  claim 58  wherein the yield is of a commodity.  
     
     
         60 . The financial product of  claim 59  wherein the commodity is an agricultural commodity.  
     
     
         61 . The financial product of  claim 60  wherein the agricultural commodity is corn.  
     
     
         62 . The financial product of  claim 60  wherein the agricultural commodity is soybeans.  
     
     
         63 . The financial product of  claim 58  wherein the yield is of a metal.  
     
     
         64 . The financial product of  claim 63  wherein the metal is gold.  
     
     
         65 . The financial product of  claim 58  wherein the yield is of a petroleum prodcut.  
     
     
         66 . The financial product of  claim 58  wherein the yield is of a currency.  
     
     
         67 . The financial product of  claim 66  wherein the currency is a Euro.  
     
     
         68 . The financial product of  claim 66  wherein the currency is the British pound.  
     
     
         69 . The financial product of  claim 58  wherein the yield is of a financial instrument.  
     
     
         70 . The financial product of  claim 58  wherein the yield is of a financial index.  
     
     
         71 . The financial product of  claim 58  wherein the yield is of a stock dividend.  
     
     
         72 . The financial product of  claim 58  further including a commitment to cover the acre yield of the future yield swap.  
     
     
         73 . The financial product of  claim 58  wherein the yield exchange is swapped between producers.  
     
     
         74  The financial product of  claim 58  wherein the yield exchange is traded on a commodities exchange.  
     
     
         75 . A method of exchanging a financial product, comprising the steps of: 
 selecting a yield;    selecting a plurality of quantities of the yield;    selecting a plurality of time frames; and    enabling a first user to transfer to a second user a first quantity of the yield in a first time frame in exchange for a second quantity of the yield in a second time frame.    
     
     
         76 . The method of  claim 75  wherein each time frame represents one calendar year.  
     
     
         77 . The method of  claim 75  wherein each time frame represents one production season.  
     
     
         78 . The method of  claim 77  wherein the first time frame is the present production season.  
     
     
         79 . The method of  claim 77  wherein the first time frame is the immediately upcoming production season.  
     
     
         80 . The method of  claim 75  wherein the yield is of an agricultural commodity.  
     
     
         81 . The method of  claim 81  wherein the agricultural commodity is corn.  
     
     
         82 . The method of  claim 81  wherein the agricultural commodity is soybeans.  
     
     
         83 . The method of  claim 75  wherein the yield is of a metal.  
     
     
         84 . The method of  claim 83  wherein the metal is gold.  
     
     
         85 . The method of  claim 75  wherein the yield is of a fuel.  
     
     
         86 . The method of  claim 85  wherein the fuel is petroleum.  
     
     
         87 . The method of  claim 75  wherein the yield is of a currency.  
     
     
         88 . The method of  claim 87  wherein the currency is a Euro.  
     
     
         89 . The method of  claim 87  wherein the currency is the British pound.  
     
     
         90 . The method of  claim 75  wherein the yield is of a financial instrument.  
     
     
         91 . The method of  claim 75  wherein the yield is of a financial index.  
     
     
         92 . The method of  claim 75  wherein the yield is of a stock dividend.  
     
     
         93 . A method of exchanging a financial product comprising: 
 selecting a yield;    selecting a plurality of quantities of the yield;    designated a price for each of the plurality of quantities of the yield;    enabling a first user to purchase one of the plurality of quantities for the designated price for a given time frame from a second user,    wherein if a quantity of the yield equal to the amount of the purchased one of the plurality of quantities for the given time frame is not accrued, then the second user provides the first user with a quantity of the yield equal to the portion of the purchased one of the plurality of quantities not accrued.    
     
     
         94 . The method of  claim 93  wherein the yield is of an agricultural commodity.  
     
     
         95 . The method of  claim 94  wherein the agricultural commodity is corn.  
     
     
         96 . The method of  claim 95  wherein the agricultural commodity is soybean.  
     
     
         97 . The method of  claim 93  wherein the yield is of a currency.  
     
     
         98 . The method of  claim 97  wherein the currency is the Euro.  
     
     
         99 . The method of  claim 97  wherein the currency is the British pound.  
     
     
         100 . The method of  claim 92  wherein the yield is of a metal.  
     
     
         101 . The method of  claim 100  wherein the metal is gold.  
     
     
         102 . The method of  claim 93  wherein the given time frame is one calendar year.  
     
     
         103 . The method of  claim 93  wherein the given time frame is one growing season.  
     
     
         104 . The method of  claim 93  wherein the growing season is the next growing season.  
     
     
         105 . The method of  claim 93  wherein the yield is of a petroleum product.  
     
     
         106 . The financial product of  claim 93  wherein the yield is of a stock dividend.  
     
     
         107 . A method of exchanging a financial product comprising: 
 selecting a yield;    selecting a plurality of quantity differentials for the yield, each quantity differential representing a predetermined quantity of the yield;    designating a price for each of the plurality of quantity differentials; and    enabling a first user to purchase one of the plurality of quantity differentials for the designated price for a given time frame from a second user,    wherein if a quantity of the yield equal to a maximum amount of the purchased quantity differential during the given time frame is not accrued, then the second user provides the first user with a quantity of the yield equal to the portion of the purchased quantity differential not accrued.    
     
     
         108 . The method of  claim 107  wherein the yield is of an agricultural commodity.  
     
     
         109 . The method of  claim 108  wherein the agricultural commodity is corn.  
     
     
         110 . The method of  claim 108  wherein the agricultural commodity is soybean.  
     
     
         111 . The method of  claim 107  wherein the yield is of a currency.  
     
     
         112 . The method of  claim 111  wherein the currency is the Euro.  
     
     
         113 . The method of  claim 111  wherein the currency is the British pound.  
     
     
         114 . The method of  claim 107  wherein the yield is of a metal.  
     
     
         115 . The method of  claim 114  wherein the metal is gold.  
     
     
         116 . The method of  claim 107  wherein the given time frame is one calendar year.  
     
     
         117 . The method of  claim 107  wherein the given time frame is one growing season.  
     
     
         118 . The method of  claim 107  wherein the growing season is the next growing season.  
     
     
         119 . The method of  claim 107  wherein the yield is of a petroleum prodcut.  
     
     
         120 . The method of  claim 108  wherein the yield is of a stock dividend.  
     
     
         121 . A method of exchanging a financial product comprising: 
 selecting a yield;    selecting a baseline quantity of the yield;    selecting a plurality of quantity differentials for the yield, each quantity differential representing a predetermined quantity of the yield below the baseline quantity;    designating a price for each of the plurality of quantity differentials; and    enabling a first user to purchase one of the plurality of quantity differentials for the designated price for a given time frame from a second user,    wherein if a quantity of the yield equal to a maximum amount of the purchased quantity differential during the given time frame is not accrued, then the second user provides the first user with a quantity of the yield equal to the portion of the purchased quantity differential not accrued.    
     
     
         122 . The method of  claim 121  wherein the yield is of an agricultural commodity.  
     
     
         123 . The method of  claim 122  wherein the agricultural commodity is corn.  
     
     
         124 . The method of  claim 122  wherein the agricultural commodity is soybean.  
     
     
         125 . The method of  claim 121  wherein the yield is of a currency.  
     
     
         126 . The method of  claim 125  wherein the currency is the Euro.  
     
     
         127 . The method of  claim 125  wherein the currency is the British pound.  
     
     
         128 . The method of  claim 121  wherein the yield is of a metal.  
     
     
         129 . The method of  claim 128  wherein the metal is gold.  
     
     
         130 . The method of  claim 121  wherein the given time frame is one calendar year.  
     
     
         131 . The method of  claim 121  wherein the given time frame is one growing season.  
     
     
         132 . The method of  claim 121  wherein the growing season is the next growing season.  
     
     
         133 . The method of  claim 121  wherein the yield is of a petroleum product.  
     
     
         134 . The method of  claim 121  wherein the yield is of a stock dividend.  
     
     
         135 . A method of exchanging a financial product, comprising the steps of: 
 selecting a plurality of yields;    selecting a plurality of quantities;    selecting a plurality of time frames; and    enabling a first user to transfer to a second user a first quantity of a first yield in a first time frame in exchange for a second quantity of a second yield in a second time frame.    
     
     
         136 . The method of  claim 135 , wherein the first yield and the second yield are the same type of yield.  
     
     
         137 . The method of  claim 135  wherein each time frame represents one calendar year.  
     
     
         138 . The method of  claim 135  wherein each time frame represents one production season.  
     
     
         139 . The method of  claim 138  wherein the first time frame is the present production season.  
     
     
         140 . The method of  claim 138  wherein the first time frame is the immediately upcoming production season.  
     
     
         141 . The method of  claim 135  wherein the yield is of an agricultural commodity.  
     
     
         142 . The method of  claim 141  wherein the agricultural commodity is corn.  
     
     
         143 . The method of  claim 141  wherein the agricultural commodity is soybeans.  
     
     
         144 . The method of  claim 135  wherein the yield is of a metal.  
     
     
         145 . The method of  claim 144  wherein the metal is gold.  
     
     
         146 . The method of  claim 135  wherein the yield is of a petroleum product.  
     
     
         147 . The method of  claim 135  wherein the yield is of a currency.  
     
     
         148 . The method of  claim 147  wherein the currency is a Euro.  
     
     
         149 . The method of  claim 147  wherein the currency is the British pound.  
     
     
         150 . The method of  claim 135  wherein the yield is of a financial instrument.  
     
     
         151 . The method of  claim 135  wherein the yield is of a financial index.  
     
     
         152 . The method of  claim 135  wherein the yield is of a stock dividend.  
     
     
         153 . A method of making a financial index, comprising: 
 creating an underlying portfolio of yield risks; and    combining the portfolio into a cost index.    
     
     
         154 . The method of  claim 153  further wherein the step of creating an underlying portfolio of yield risks comprises creating an underlying portfolio of yield risks of an agricultural commodity.  
     
     
         155 . The method of  claim 154  further wherein the step of creating an underlying portfolio of yield risks of an agricultural commodity comprises creating an underlying portfolio of yield risks of corn.  
     
     
         156 . The method of  claim 154  further wherein the step of creating an underlying portfolio of yield risks of an agricultural commodity comprises creating an underlying portfolio of yield risks of soybeans.  
     
     
         157 . The method of  claim 154  further wherein the step of creating an underlying portfolio of yield risks comprises creating an underlying portfolio of yield risks of a metal.  
     
     
         158 . The method of  claim 157  further wherein the step of creating an underlying portfolio of yield risks of a metal comprises creating an underlying portfolio of yield risks of gold.  
     
     
         159 . The method of  claim 153  further wherein the step of creating an underlying portfolio of yield risks comprises creating an underlying portfolio of yield risks of a fuel.  
     
     
         160 . The method of  claim 159  further wherein the step of creating an underlying portfolio of yield risks of a fuel comprises creating comprises creating an underlying portfolio of yield risks of petroleum.  
     
     
         161 . The method of  claim 153  further wherein the step of creating an underlying portfolio of yield risks comprises creating an underlying portfolio of yield risks of currency.  
     
     
         162 . The method of  claim 161  further wherein the step of creating an underlying portfolio of yield risks of a currency comprises creating an underlying portfolio of yield risks of Euros.  
     
     
         163 . The method of  claim 161  further wherein the step of creating an underlying portfolio of yield risks of a currency comprises creating an underlying portfolio of yield risks of British pounds.  
     
     
         164 . The method of  claim 153  further wherein the step of creating an underlying portfolio of yield risks comprises creating an underlying portfolio of dividend risks of stock.  
     
     
         165 . A financial index, comprising: 
 a plurality of quantities of a commodity; and    a plurality of time frames in which the commodity will be produced;    wherein a first user and a second user may exchange quantities of the commodity based upon the matrix.    creating an underlying portfolio of yield risks; and    combining the portfolio into a cost index.    
     
     
         166 . The financial index of  claim 165  wherein the yield risks are of an agricultural commodity.  
     
     
         167 . The financial index of  claim 166  wherein the agricultural commodity is corn.  
     
     
         168 . The financial index of  claim 166  wherein the agricultural commodity is soybeans.  
     
     
         169 . The financial index of  claim 166  wherein the commodity is metal.  
     
     
         170 . The financial index of  claim 169  wherein the metal is gold.  
     
     
         171 . The financial index of  claim 165  wherein the yield is of a petroleum product.  
     
     
         172 . The financial index of  claim 165  wherein the yield is of a currency.  
     
     
         173 . The financial index of  claim 172  wherein the currency is a Euro.  
     
     
         174 . The financial index of  claim 172  wherein the currency is the British pound.  
     
     
         175 . The financial index of  claim 165  wherein the yield is of a financial instrument.  
     
     
         176 . The financial index of  claim 165  wherein the yield is of a financial index.  
     
     
         177 . The financial index of  claim 165  wherein the yield is of a stock dividend.